Main stock price index ends higher; peso strengthens to 49.705 to $1

The benchmark Philippine Stock Exchange index (PSEi) rose above the 7,600 level yesterday, in line with signals that stock market observers said was part of a broader “breakout” after months of consolidation.

The PSEi ended yesterday’s session higher by 0.45 percent, or 34 points, to 7,617. The broader All-Shares index was also up 0.39 percent to 4,541.61.

Trading volume at 1.48 billion shares valued at P6.1 billion was thinner than average, although analysts had anticipated this given the Holy Week holidays were nearing.

Last week, BDO Unibank chief strategist Jonathan Ravelas said indicators pointed to a breakout for the PSEi. He said the benchmark index could trade between the 7,400 and 7,800 range in the short term.

Meanwhile, all sub-sectors ended in positive territory yesterday.

Gainers were led by property, up 1.12 percent, and services, up 1.07 percent. A total of 101 companies gained while 88 declined and 50 closed unchanged.

BDO was the most actively traded stock as it rose 0.41 percent to P121.10 a share. It was followed by Megaworld Corp., up 2.54 percent to P4.04; Metropolitan Bank and Trust Co., unchanged at P87.30; SM Investments Corp., down 1.49 percent to P727, and GT Capital Holdings Inc., up 4.43 percent to P1,225 a share.

In the currency market, the peso yesterday strengthened to close at 49.705:$1 after trading at the 50:$1 level for almost two months.

The peso hit an intraday high of 49.70 to $1 and a low of 49.88, its starting rate for the day.. The peso slid to the 50:$1 level, the weakest in over a decade, on Feb. 17 and stayed there until last Friday’s close of 50.08:$1.

“Our traders received report that the market seems to be encouraged by the good prospects of the government’s tax reform package and tax amnesty plan. As you know, we have expressed support of such a plan because from a monetary perspective, over the medium term, that is going to be a positive for price stability. Infrastructure spending is a winning proposition for everyone. I also believe that the country’s sustained positive macroeconomic outlook on growth and price stability helped convince the market that it needed to consolidate and reconsider its unfavorable view about the peso. Despite some political noise, the economy is well on its track of demonstrating its good performance despite the risky operating environment,” Bangko Sentral ng Pilipinas Deputy Governor Diwa C. Guinigundo said in a text message to reporters.